Building a regional solar PV value chain in East Africa

Abstract

As East African countries seek to address persistent energy poverty while positioning themselves within the global green economy, solar photovoltaics (PV) has emerged as a promising technological and industrial pathway. However, current patterns of adoption in the region remain heavily dependent on imported components, particularly from China, and are largely limited to deployment and distribution stages. This dependency not only undermines long-term energy security but also constrains the region’s ability to capture industrial and employment benefits associated with the clean energy transition.

This thesis investigates the potential for East African countries to collectively establish a regional solar PV manufacturing value chain (RVC), drawing strategic insights from China’s rise as the world’s leading solar PV producer. It addresses the core research question: To what extent can regional cooperation help East African countries build a sustainable solar PV value chain, and how can China’s experience inform this process?

The study adopts a multi-framework analytical approach, integrating the Technological Innovation System (TIS) framework, a regional integration into global value chains (GVCs) perspective informed by Bamber et al.’s competitiveness framework, and the developmental regionalism approach. These frameworks are applied sequentially across three empirical chapters.

First, through a TIS analysis of twelve East African countries, the study identifies systemic bottlenecks in the region’s solar PV innovation systems. While downstream deployment is gaining momentum—especially through off-grid solutions—upstream and midstream industrial development remains limited. Functions such as knowledge development, entrepreneurial experimentation, and resource mobilization are weakly fulfilled. Kenya and Ethiopia are the only countries showing nascent manufacturing activities: Kenya through local module assembly (Solinc), and Ethiopia through foreign direct investment in cell production. Most other countries lack the institutional coordination, industrial capabilities, and policy direction needed to support solar PV manufacturing.

Second, the study applies a regional value chain lens grounded in regional integration theory and developmental regionalism to explore the feasibility of task-sharing across countries. No single East African country possesses the full set of capabilities required for a vertically integrated solar PV industry. However, several countries demonstrate complementary strengths: Rwanda, Tanzania, and Uganda possess critical mineral reserves such as tin and copper; Ethiopia offers abundant low-cost hydropower for energy-intensive processing; Kenya has the most advanced industrial infrastructure and logistics connectivity. This uneven distribution of capabilities provides a strong rationale for a coordinated regional manufacturing strategy based on functional specialization.

To operationalize this vision, the thesis proposes a regional specialization model in which upstream resource processing is concentrated in mineral-rich countries, midstream activities are sited in energy-abundant zones, and downstream module assembly and system integration is anchored in Kenya. Countries like Rwanda may also serve in support roles for certification and trade facilitation. This model not only addresses structural asymmetries but also aligns with the principles of developmental regionalism that emphasize state-led industrial cooperation and regional complementarity.

Third, the study turns to China’s experience in developing a world-leading solar PV industry as a latecomer. Through catch-up theory and policy transfer analysis, the research identifies both the mechanisms behind China’s success—such as sequenced industrial policy, vertical coordination, and innovation investment—and the structural differences that constrain direct replication in East Africa. Instead of wholesale policy borrowing, the thesis identifies a selective set of transferable lessons: gradual policy layering, clustering and SEZ development, quality certification systems, public-private-academic collaboration, and performance-linked incentives.

The study concludes that while East Africa faces formidable constraints—ranging from fragmented markets to underdeveloped industrial ecosystems—strategic regional cooperation presents a viable path forward. By aligning national comparative advantages and adapting selected lessons from China’s experience, East African countries can collectively enter higher-value segments of the global solar PV supply chain. This will require not only targeted investment and institutional innovation, but also robust regional mechanisms to coordinate infrastructure, standards, and industrial policy.